by Reuben Kelly
Much like beauty, luxury is in the eyes of the beholder. At Monocle, we uncovered that the way that Millennials define & identify luxury can vary from Millennial to Millennial, and identified 7 different types of luxury. When it comes to luxury purchase frequency, it turns out that not all Millennials behave in the same manner. For example, Millennials who view luxury as experiential purchase luxury more frequently at an average of 7 times a month, whereas Millennials who define luxury as an indulgence purchase luxury less frequently at an average of 3 times a month. After further investigation, we discovered that some Millennials prefer to consume luxury more frequently, whereas others derive great enjoyment from consuming luxury less. Millennials who define luxury as experiential believe that luxury revolves around being energized through adventure and freedom, and want their luxury purchases to provide them with lasting memories. For these Millennials, the more positive memories they can create in their lifetime, the merrier, hence the higher luxury purchase frequency. On the other hand, Millennials who define luxury as indulgence believe that luxury is centered on self-reward and special moments. For these Millennials, the moments that are truly special to them don’t occur in a regular fashion, hence the lower luxury purchase frequency. When playing in the Millennial luxury marketplace, then understanding how your consumers define luxury is very important, as it will directly affect how you optimize your customer acquisition and customer retention efforts. If you play in an experiential luxury space, customer retention will be of the utmost importance, as those Millennials purchase luxury more frequently. On the contrary, if you play in an indulgence luxury space, customer acquisition will be of greater importance, as those Millennials purchase luxury less frequently.
How do your customers define luxury, and what does this mean for your business growth strategy?